Toople PLC Trading Statement (2610A)
March 23 2017 - 3:01AM
UK Regulatory
TIDMTOOP
RNS Number : 2610A
Toople PLC
23 March 2017
23 March 2017
Toople Plc
("Toople" or the "Company" or the "Group")
Trading Update
Toople Plc (LSE: TOOP), a provider of bespoke telecom services
to UK SMEs, provides the following update on trading.
Since announcement of the Company's results for the year ended
30 September 2016, the Board has seen increasing competition in the
SME broadband market such that it has become increasingly difficult
for the Group to differentiate itself around this service as
originally anticipated when the Toople brand was launched, in May
2016.
As detailed in the full year results, the Company is
consistently evaluating its marketing efforts to ensure that the
most effective routes to market are utilised, both from a delivery
and cost perspective. As a result of the increasing competition in
the broadband market, and recent changes in the cost of customer
acquisition through certain channels, the Company is currently
reviewing funding options to provide additional working capital and
to accelerate sales growth in the higher margin, retail
business.
Accordingly, the Board intends to focus on driving its cloud
business telephony service, which has the benefit of having higher
margins. The Company has seen strong interest in the newly launched
telephony service which the Board believe should provide a key
driver for new customer acquisition going forward. In addition to
having higher margins, the telephony service has the additional
benefit that customers (to date) are typically signing 36 month
agreements. Over 70% of these customers also order Toople broadband
for the connectivity. Growth in this service since launch has
offset a downturn in new orders in the non-strategic, lower margin,
wholesale business in the first two months of 2017.
The Board anticipates revenue growth in the period for the six
months to March 2017 to show an increase in excess of around 60%
over the same period in the prior year (H1 March 2016), and an
increase of approximately 19% against the prior half (H2 2016).
Losses for the period (H1) are expected to be reduced by circa 50%
against H2 2016. The Board continues to focus on tight cost
control.
Currently Toople has over 600 small businesses directly
contracted with in excess of over 1,000 RGU's (revenue generating
units) across the customer base. *
*Wholesale numbers are excluded from this figure.
Andy Hollingworth, CEO, Toople Plc, said, "The Board believes
that Toople's proposition remains clear and attractive to the SME
market. As a small company we have the benefit of being able to
react swiftly when we see the market changing and whilst the
increasing competition in the SME broadband market has provided us
with additional challenges, we have been able to react and shift
our focus to driving forward the cloud based telephony business as
our flagship customer entry point. Early indications are that the
Company's cloud business telephony service is being well received
by the SME market and the margins associated with this are
attractive. With the market opportunity being clear, we will
explore options to ensure we are able to capitalise on this
effectively and drive further growth."
- ENDS -
For further information:
Toople PLC 0800 0499 499
Andy Hollingworth, Chief
Executive Officer
Hybridan LLP 020 3764 2341
Claire Louise Noyce
Redleaf Communications 020 7382 4730
Rebecca Sanders-Hewett toople@redleafpr.com
Charlie Geller
Sam Modlin
Notes to Editors
Toople Plc offers broadband, VoIP and landline services and
mobile phone packages to SMEs in the UK. Customers can visit the
Toople.com web site to buy online, request a quote or instantly
chat with an agent and chose the services relevant to their
business.
The web site is powered by Toople.com proprietary Merlin
software; a cloud based telecoms resourcing platform that acts as a
portal for transparent, live pricing for services across the main
four providers. Merlin also makes it easy for customers to add new
services to their bespoke packages at any time.
Toople Plc has three core elements to its business. Firstly
Toople.com, its online first approach for small businesses where
customers can buy connectivity, mobility and business telephony in
a simple online journey. Customers can do this by simply requesting
a quote or instantly engaging into a chat with an agent. Potential
customers experience Toople.com through digital media channels like
Google, Bing, Business cost comparison sites and social media.
Secondly, the wholesale business has a number of other telecoms
companies that buy services wholesale, white label the propositions
and resell on to their own customers. Thirdly, the Merlin software
platform gives access to wholesalers who want to interconnect with
carriers for provisioning and billing services for their own
customers, where a monthly licence fee is applicable to access
merlin.
Toople plc is addressing a market of over 5 million companies in
the UK that are employing less than 50 people. These companies are
looking for straightforward telecom solutions, explained in a way
that they can understand, provided at attractive consistent prices
and backed up by high quality service support. Toople aims to be
easy to do business with, offering transparent, competitive pricing
and excellent UK based customer service. The Company plans to
rapidly increase brand awareness and build its client base through
strategic on-line marketing campaigns.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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